RMA Communication & Client Relations 3

Question 1

A client's adult child contacts the adviser demanding account information without the client's prior authorization. The adviser should:

Accepted Answer

Request written authorization and share nothing until it is received

Answer

Privacy regulations require written authorization before sharing client data with any third party, including family members.

Question 2

Which approach best helps clients understand the concept of sequence-of-returns risk in retirement?

Accepted Answer

Use a simple visual showing two hypothetical retirees with identical average returns but different return sequences

Answer

A side-by-side scenario illustration makes the abstract concept of sequence risk concrete and emotionally resonant for clients.

Question 3

When a client expresses fear about outliving their money, the adviser's FIRST step should be to:

Accepted Answer

Validate the concern and then quantify the risk using the client's actual data

Answer

Validating longevity fear first, then grounding the conversation in the client's specific numbers, leads to more effective solution-building.

Question 4

A newly retired client requests monthly meetings but the adviser believes quarterly is sufficient. The best resolution is to:

Accepted Answer

Discuss the client's underlying concern, then propose a transition plan from monthly to quarterly as confidence grows

Answer

Understanding the root of the request (anxiety, adjustment) allows the adviser to address it while working toward a sustainable meeting cadence.

Question 5

Which statement best describes the role of a written Investment Policy Statement (IPS) in client communication?

Accepted Answer

It serves as a shared reference that aligns client expectations with portfolio management decisions

Answer

An IPS creates a communication framework that keeps both adviser and client anchored to agreed-upon goals and guidelines.

RMA Practice Test